Between 2007 and 2010, the median net worth of U.S. households fell by 47 percent, reaching its lowest level in more than forty years, adjusted for inflation. In other words, middle class wealth virtually evaporated in this country. A good chunk of the population got sucked through a financial wormhole back to the sixties.
Even the conservative, investor class-favoring Federal Reserve has average net worth dropping 39% from 2007-2010....
In June, the Federal Reserve released its own analysis of household finances, which found that median net worth (which just means a family's assets minus its debts) fell closer to 39 percent from 2007 to 2010.
While average net worth has fallen back to 1960's levels in the wake of the financial sector collapse......corporate profits are at an all time high...
U.S. corporate profits as a share of GDP are at all time highs while wages and salaries are at an all time low. Charts
Is it any wonder, then....what business executives are most fearful of in the new year?
“the single greatest fear among executives everywhere is weak consumer demand for their companies’ products and services.” (CBS News)
Not all that complicated, is it? Over a trillion dollars has been stripped from national yearly GDP numbers as a direct result of tens of millions of Americans losing purchasing and credit power following the 2007-08 meltdown of the Wall Street Casinos. Large corporations are swimming in extra cash while setting record profits......Americans are struggling to make ends meet as they adjust their lives to be more in line with 1960's America.
While average Americans were beaten up after the 2008 financial industry collapse, they have been getting beaten up for decades....
The richest 1 percent received over one-third of the total gain in marketable wealth over the period from 1983 to 2007. The next 4 percent also received about a third of the total gain and the next 15 percent about a fifth, so that the top quintile collectively accounted for 89 percent of the total growth in wealth, while the bottom 80 percent accounted for 11 percent.
To the above data, add the fact that tax rates in America are at 60 year lows and the effective corporate tax rate is among the lowest in the world.
Now, with all that data as a backdrop.....what are our Very Serious Leaders telling us must be done? What are conservatives saying? "Our country doesn't have a revenue problem, we have a......spending problem." Right? Cut government spending.....all of it. Well....all of it except the Empire's military budget. Cut spending for programs that go to help the 80% of Americans who are now adjusting to 1960's level finances. Cut food stamps, cut unemployment.....for people who don't have enough in their pockets now to stimulate economic demand. Cut unions, in effect, lowering wages even further.
And what of alleged progressive Leaders? What are they willing to hand over to their cannibalistic brethren? Chained CPI.....perhaps Medicare eligibility age as well. Both of which will exacerbate the already-depressing numbers in the opening paragraphs above. Alleged progressive Leaders, like President Obama, used to talk about raising taxes on those above $250K per year.....then it became $400K per year, then $500K per year was suggested......others would settle for $1 million per year or better.
Thus...the disconnect. The facts of the situation are clear and inarguable. The rich and powerful have been getting richer and more powerful over the last 30 years, big corporations have been thriving, the investor class bathing in hundred dollar bills.....while 80% of the country have seen their financial standing fall backward a full 40 years.
If a dysfunctional House couldn't find the votes to increase income tax rates on the top .19%.....the richest of the rich.....and Democrats are showing all their "compromise" cards before the game starts by offering up geezer raises in Social Security as a sacrifice to the supply side gods.....what hope is there that anything constructive will be forthcoming from our Very Serious Leaders either before the year ends....or after?
About This Blog